IN THE SUPREME COURT OF BANGLADESH
(APPELLATE DIVISION)
Civil Petition for Leave To Appeal No. 414 of 1999
Decided On: 25.05.1999
Appellants: Commissioner of Customs, Chittagong
Vs.
Respondent: Abu Hasnat and others
**Hon’ble Judges:**A.T.M. Afzal, C.J., Mustafa Kamal, Latifur Rahman, Bimalendu Bikash Roy Chowdhury and A.M. Mahmudur Rahman, JJ.
Subject: VAT
Catch Words
Mentioned IN
Counsels:
For Appellant/Petitioner/Plaintiff: Mahmudul Islam, Attorney General B. Hossain, DAG with him, instructed by Sharifuddin Chaklader, Advocate-on-Record
For Respondents/Defendant: Mvi. Md. Wahidullah, Advocate-on-Record, For Respondent No. 1.
Citing Reference:
Discussed
1
Case Note:
Personal Guarantee**
Personal guarantee is generally a weak and uncertain security and the creditor more often than not may have to chase a will-o-the-wisp. Such guarantees are deprecated and the Court will be well advised not to involve public authorities from running after such personal guarantees.****
Commissioner of Customs Vs. Giasuddm Chowdhury, 50DLR(AD) 129–Cited**
JUDGMENT
A.T.M. Afzal, C.J.
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The Commissioner of Customs is aggrieved by the interim Order passed by a Writ Bench of the High Court Division while issuing Rule Nisi on 22nd March, 1999 in Writ Petition No. 944 of 1999 filed by respondent No. 1. The writ petition was filed challenging the Order dated 14.3.99 passed by the office of the petitioner directing the respondent-writ-petitioner to declare loaded value of the imported goods at the rate of US $ 1,000 per Metric Ton instead of C & F value and further to show cause why the respondents (in the writ petition) should not be directed to levy and collect the customs duty, VAT and other taxes in respect of the disputed (imported) consignment on the basis of C & F value.
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A Rule Nisi was issued as prayed for and an interim Order was passed in the following terms:
Pending hearing of the Rule, the respondent No. 1 is directed to allow the petitioner to release the imported goods covered under L/C No. IMG/CASH1012/98 dated 15.12.98 on payment of duties and taxes on the basis of C & F value and on furnishing personal guarantee for the difference between C & F value and loaded value as demanded by Customs Authority within seven days from the date of receipt of this Order.
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The learned Attorney General submits that there having been no jurisdictional question involved in the impugned Order (in the writ petition) and the main allegation being that the value sought to be introduced for assessment of customs duties etc was grossly inflated having no objective basis and did not reflect the fair value of the goods in the international market, the High Court Division was not justified in passing the impugned Order causing serious prejudice to public revenue. The learned Attorney General laments that the message given by this Division in the case of Commissioner of Customs Vs. Giasuddin Chowdhury 50 DLR (AD) 129 which was loud and clear in such matters of interim orders involving public revenue has failed to reach the High Court Division and interim orders for release of goods without payment of the assessed customs duties etc. are being made in a routine manner causing prejudice to the financial management of the State. The learned Attorney General submits that, at any rate, the Order directing release of goods upon furnishing only a personal guarantee was plainly a bad exercise of discretion in that a personal guarantee is no security at all and fraught with unimaginable uncertainties in enforcing such guarantee.
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We think there is considerable substance in the submission made by the learned Attorney General. It has come to our notice that the High Court Division has been routinely passing orders directing release of goods in terms of the assesses prayer pending disposal of the Rule Nisi notwithstanding the caution and guidelines given by this Division in the aforesaid case of Giasuddin Chowdhury. It is expected that before granting such an Order of release without paying the full duties etc. as assessed the Court will be satisfied in the facts of a particular case as to the tests laid down in the said case. We think it is time to reiterate the broad principle which was emphasized in that case and which must govern the granting of such an Order of release. It was laid down, inter alia, that:
Generally speaking, impeding the assessment or collection of public revenue is otherwise harmful to the public interest. In cases where no jurisdictional issues are involved and when the manufacturer, trader or importer usually pass on the burden of new, additional or increased indirect taxation to the consumers, there is absolutely no justification to protect their temporary private interest by an interim Order, impeding the collection of pub he revenue.
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In the instant case the impugned Order seems to be worse because the Order for release of goods has been made upon a personal guarantee for the difference between C & F value and loaded value as demanded by the customs authority. Personal guarantee is generally a weak and uncertain security and the creditor more often than not may have to chase a will-o-the wisp. Such guarantees are deprecated and the Court will be well-advised not to involve public authorities from running after such personal guarantees.
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The writ-petitioner also having himself realized the weakness of the impugned Order has offered by an application to furnish bank guarantee for the difference between the C & F value and the loaded value as demanded by the customs authority and prayed for modification of the impugned Order of the High Court Division in the said term. In the circumstances when the Order for release has already been made, we think it will meet the ends of justice if in modification of the impugned Order the petitioner (respondent No. 1 in the writ petition) is directed to release the goods in question to the importer on payment of duties and taxes on the basis of C & F value and upon furnishing a bank guarantee for the difference between C & F value and loaded value as demanded by the customs authority forthwith.
The petition is disposed of with the modification of the impugned Order as above.